The investment, which comes as sluggish growth and inflation
give some investors pause in Latin America's biggest economy,
follows heavy interest by foreign investors in recent years in
the country's $10 billion e-commerce market.

Despite the slowdown, many internet companies, venture
capital groups and other investors believe the market will grow
rapidly in a country with relatively low Internet penetration.

In a statement, Wayne Kozun, a senior vice president at
Teachers,' as the pension fund is known, cited "a growing middle
class, huge consumption potential and significant growth in
online and mobile access" as reasons for the Dafiti investment.

Dafiti, Brazil's answer to Zappos, the popular shoe and
fashion retailer owned by Amazon, is undeterred by high
inflation, soaring household debt and the other economic woes
that could crimp consumer sentiment.

Brazil's economy, fueled in part by soaring consumer demand
during a decade-long boom, is expected to grow by little more
than 2 percent this year, compared with the 7.5 percent growth
posted in 2010.

"When we look at Brazil, we don't think only of GDP growth,
but also a middle class and disposable income that continue to
grow," Philipp Povel, one of Dafiti's founders, said in an
interview.